Valencia could receive an additional 3.67 billion euros

Spain’s regional funding is to be reorganised.

There is a great deal at stake for the Comunitat Valenciana: according to calculations by the Ministry of Finance, the new model could see it receive an additional 3.669 billion euros. This money will bolster the Generalitat’s budget and, consequently, sectors such as health, education and care. The reform has not yet been finalised.

On 4 September, the Consejo de Política Fiscal y Financiera (CPFF) approved the reform of Spain’s regional funding system. According to the Ministry of Finance, the new model is intended to provide the autonomous communities with a total of 20.975 billion euros in additional funding bring.

For the Comunitat Valenciana, the potential increase is particularly high. The Treasury estimates the increase compared with the current funding system at 3.669 billion euros.

However, this sum does not yet represent a fixed payout amount. The new system must first be implemented in law.

What does this mean for the Costa Blanca?

The additional billions would not go directly to towns such as Dénia, Calp, Benidorm, Alicante or Torrevieja. The recipient would be the Comunitat Valenciana.

Nevertheless, this is of direct relevance to residents of the Costa Blanca. The Generalitat funds key public services, including Healthcare, education and care. These include, for example, hospitals, health centres and schools.

Hacienda identifies the Valencian Community as one of the regions disadvantaged by the current funding system. With an additional 3.669 billion euros, Valencia would be among the communities with the largest absolute increase under the new model.

However, this does not specify exactly how the Generalitat will allocate the additional funds at a later date.

Why is Valencia getting more money?

Population figures alone are not the decisive factor in the allocation. The new model is based on what is known as the „adjusted population“, an adjusted population figure.

This takes into account the variations in actual demand for public services across regions. Factors such as the age structure, health and education needs, and geographical factors all play a part.

The aim is to reduce the differences in per capita funding between the autonomous communities.

At the same time, no region should be left in a worse financial position as a result of the change than it was under the previous system.

The Generalitat votes against the new model

Despite the potential windfall of billions, the Valencian regional government voted against the reform in the CPFF.

Among other things, the Consell has criticised the lack of consensus among the autonomous communities and is calling for further measures to tackle Valencia’s structural underfunding.

Madrid and Valencia therefore remain at odds over their assessment of the reform: the central government regards the new model as a significant improvement for the Comunitat Valenciana, whilst the Generalitat considers the proposed solution to be insufficient.

In 2027, payments to the regions will increase in any case

Regardless of the reform, the autonomous communities are set to receive higher regular advance payments from the funding system as early as 2027.

Hacienda has a total of 170.529 billion euros announced – 8.1 per cent more than in 2026.

This sum should not be confused with the additional 20.975 billion euros under the new model. The regular advance payments are separate from this; the Treasury expressly points out that the funds would increase even further should the new system be adopted.

The reform still has to pass through Parliament

The new funding system has not yet come into force definitively, despite the CPFF’s approval.

Under the current procedure, the reform must be implemented by law and approved by parliament. The Spanish Government wants the new model with effect from 1 January 2027 bring into force.

For the Comunitat Valenciana, this is therefore about far more than an abstract financial debate in Madrid. Should the Treasury’s calculations prove accurate and the reform be passed, the Generalitat would 3.669 billion euros more than is available under the current system – and thus additional funding for public services on which people on the Costa Blanca also depend.